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Wyden and Pallone to Price: No Authority to Approve Harmful Medicaid Waivers

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WASHINGTON - Senate Finance Committee Ranking Member Ron Wyden, D-Ore., and House Energy and Commerce Committee Ranking Member Frank Pallone Jr., D-N.J., today sent a letter to Health and Human Services (HHS) Secretary Tom Price reminding him that Medicaid waivers cannot be approved by the agency if they are not in line with the objectives of the program. The letter comes as Secretary Price and newly confirmed CMS Administrator Seema Verma yesterday sent a letter to governors signaling openness to approving Medicaid waivers that include ideologically-motivated policies that would harm beneficiaries and run against Medicaid's objectives.

"State flexibility is an important objective in Medicaid, but only if it lets states do better, not worse," Wyden said. "Secretary Price would do well to remember that Medicaid exists to provide health care security to the most vulnerable and needy people in America, not to subject people to his misguided ideological objectives. If this is Phase Two of Trumpcare, millions of Americans have big reason to worry."

"It's outrageous that one of Secretary Price and Administrator Verma's first actions is intended to limit people's access to health care," Pallone said. "State flexibility is critical to the success of Medicaid, but it was never intended as a tool to allow states to ration health care for Americans. This announcement would result in delaying or denying access to coverage for a significant number of Medicaid beneficiaries, building on efforts by Republicans to pass a repeal bill that would cut Medicaid coverage for millions of Americans."

The letter comes as Secretary Price and Verma yesterday sent a letter to governors indicating openness to approving waivers that would reduce enrollment and increase hardship for Medicaid beneficiaries.

As Ranking Members of the U.S. Senate Finance Committee and the House Energy and Commerce Committee, we have the responsibility and privilege of protecting the rights of the more than 74 million Americans who receive health care under the Medicaid and CHIP programs. In light of that responsibility, we are writing to remind you of the statutory objectives of the Medicaid program put forth by Congress and to express our deep concern with approval of waivers based on ideological and misguided policies that are not in line with Congress' longstanding intent for the Medicaid program.

Medicaid provides comprehensive and affordable health coverage to millions of seniors, people with disabilities, children, and working adults. It supports the providers, hospitals, and clinics that serve our communities, boosting state and local economies. The Affordable Care Act's (ACA) Medicaid expansion is indisputably a good deal for states and has been life-changing for millions of beneficiaries. The Congressional Budget Office (CBO) estimates that states will spend just 1.6 percent more on Medicaid and CHIP with the expansion than they would have without health reform, and this modest cost more than pays itself back with benefits to a state's economy. These fiscal impacts are substantial. For example, one study estimated savings and revenue of $1.8 billion by the end of 2015 across the eight expansion states it examined. Research shows that beneficiaries in states that have expanded Medicaid have greater access to health care services and fewer problems paying their medical bills , and hospitals are admitting fewer uninsured patients. Medicaid expansion also has a positive effect on private insurance marketplace consumers leading to decreased premiums by an estimated 7 percent in expansion states.

Medicaid has made significant strides as a program, particularly in recent years, and the opportunity has never been greater to build on recent state successes and move the program forward. There are groundbreaking examples of innovation happening--on a small and large scale--in every single state Medicaid program today. Medicaid's existing flexibility has allowed states to become laboratories of health innovation to deliver quality care and protect consumers against health crises while lowering costs, many of which are informing efforts we would like to see elsewhere in our health care system.

The Medicaid program is a health insurance program, and Medicaid's statutory objective is clear: the program is intended to provide "medical assistance [to eligible individuals] whose income and resources are insufficient to meet the costs of necessary medical services" and "rehabilitation and other services to help such families and individuals attain or retain capability for independence or self-care." We support the use of existing flexibility to advance these objects. Approval of waivers which include misguided and harmful ideological policies that are not in line with the aforementioned stated statutory objective, such as proposals to make health coverage contingent on work requirements and onerous premiums and cost-sharing do not align with this Congressional intent. Work requirements, lock-out periods, time limits, and imposition of onerous premiums and cost-sharing on Medicaid families, who are generally living on a budget of roughly less than $15,000 per year, are not only punitive but also counterproductive in the long term. Requiring poor families to pay more than they can afford for care makes them less likely to access the care they need or maintain their coverage. Ultimately, this leads to poorer health and more frequent use of the emergency room. Instead, as Secretary of the U.S. Department of Health and Human Services (HHS), you should be focused on encouraging states to implement effective ways of coordinating care and delivery system reforms, helping families to get the full range of health and social services they need to be healthy and engaged in the community.

In recent years, the Medicaid program has made significant gains, covering more people while states, at the same time, pilot new and innovative delivery systems that provide better integration of care while constraining costs. Medicaid waiver proposals must be judged on the Centers for Medicare & Medicaid Services' stated principles: whether they strengthen coverage, expand access to providers, improve health outcomes, and increase the efficiency and the quality of care for individuals. We urge you to continue to adhere to such standards, which are founded on Congress' longstanding intent that is reflected in the statute that has governed the Medicaid program for more than fifty years. In the end, a high-quality Medicaid program pays all of us as a society back.

We look forward to working with HHS to move the Medicaid program forward by building on successful state efforts that support beneficiaries and ensure a strong program in the coming years.